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Finance. In finance, a credit spread, or net credit spread is an options strategy that involves a purchase of one option and a sale of another option in the same class and expiration but different strike prices. It is designed to make a profit when the spreads between the two options narrows . Investors receive a net credit for entering the ...
A long butterfly options strategy consists of the following options : Long 1 call with a strike price of (X − a) Short 2 calls with a strike price of X. Long 1 call with a strike price of (X + a) where X = the spot price (i.e. current market price of underlying) and a > 0. Using put–call parity a long butterfly can also be created as follows:
Option-adjusted spread (OAS) is the yield spread which has to be added to a benchmark yield curve to discount a security 's payments to match its market price, using a dynamic pricing model that accounts for embedded options. OAS is hence model-dependent. This concept can be applied to a mortgage-backed security (MBS), or another bond with ...
Algorithmic trading is a method of executing orders using automated pre-programmed trading instructions accounting for variables such as time, price, and volume. [ 1] This type of trading attempts to leverage the speed and computational resources of computers relative to human traders. In the twenty-first century, algorithmic trading has been ...
The largest holding is Broadcom, but with just a 3.6% weighting, the fund isn't concentrated in only its top holdings. And while the fund has just 1.9% in P&G and 1.1% in Pepsi, it also includes ...
In mathematical finance, a Monte Carlo option model uses Monte Carlo methods [Notes 1] to calculate the value of an option with multiple sources of uncertainty or with complicated features. [1] The first application to option pricing was by Phelim Boyle in 1977 (for European options ).
Find out why these two companies will likely be long-term winners regardless of what the market does in the short run. 1. Apple. Apple's shares were down by about 5% on Monday. Though that doesn't ...
Let's look at two top stocks that pay regular dividends to shareholders. These profitable companies are leaders in their industries that can fund dividends for many years. 1. AT&T. AT&T (NYSE: T ...